1. Having or being an interest rate that is higher than a prime rate and is extended especially to low-income borrowers.
2. Extending or obtaining a subprime loan.

A classification of borrowers with a tarnished or limited credit history. Lenders will use a credit scoring system to determine which loans a borrower may qualify for.

Subprime loans carry more credit risk, and as such, will carry higher interest rates as well.

Occasionally some borrowers might be classified as subprime despite having a good credit history because the borrowers have elected not to provide verification of income or any assets in the loan application process.